- The Planning Institute of Jamaica (PIOJ) is reporting estimated fourth quarter calendar year growth of 0.1 per cent, between October and December 2019, relative to the corresponding period in 2018.
- This, consequent on estimated growth of 1.8 per cent in the services industry, despite a 3.8 per cent contraction in the goods producing industry, Director General, Dr. Wayne Henry, has said.
- He was speaking during the PIOJ’s quarterly media briefing at the agency’s head office in New Kingston on Tuesday (February 25).
The Planning Institute of Jamaica (PIOJ) is reporting estimated fourth quarter calendar year growth of 0.1 per cent, between October and December 2019, relative to the corresponding period in 2018.
This, consequent on estimated growth of 1.8 per cent in the services industry, despite a 3.8 per cent contraction in the goods producing industry, Director General, Dr. Wayne Henry, has said.
He was speaking during the PIOJ’s quarterly media briefing at the agency’s head office in New Kingston on Tuesday (February 25).
Dr. Henry said the December quarter figure, which also represents the third quarter out-turn for the 2019/20 fiscal year, will, subject to Statistical Institute of Jamaica (STATIN) ratification, mark a record 20th consecutive period of economic growth for the country.
He advised that the economy is estimated to have grown by 0.9 per cent during 2019, consequent on the December quarter out-turn, and represents the seventh consecutive year of growth for Jamaica.
Dr. Henry said the December 2019 quarter growth out-turn reflected the combined impact of increased external demand from Jamaica’s main trading partners, which supported growth in exports of some goods and services.
There was also expansion in hotel room and air-seat capacity, which spurred growth in stopover arrivals; more favourable weather conditions, which facilitated increased output per acre for some domestic crops as well as water production; and increased use of financial services, facilitated by lower interest rates and a relatively stable macroeconomic environment.
The Director General said the Services Industry subsectors recording the strongest growth during the review period were Hotels and Restaurants – up 3.5 per cent, Finance and Insurance Services – up 3.4 per cent, and Electricity and Water Supply – up 2.7 per cent.
Dr. Henry noted that the out-turn for Hotels and Restaurants was influenced by a 5.8 per cent growth in foreign national arrivals, due mainly to an increase in the number of visitors from the United States of America (USA), and Latin America and the Caribbean, as against declines in the Canadian and European markets.
“Stopover arrivals from the USA increased by 11 per cent to 443,314 persons and by 27.3 per cent to 10,029 persons for Latin America and the Caribbean. In contrast, arrivals from Canada declined by 2.5 per cent to 103,906 persons and, from Europe by 5.2 per cent to 81,158 persons,” he informed.
Dr. Henry said, however, that cruise passenger arrivals declined by 17.3 per cent, to 431,296 persons due to contractions in the number of passengers arriving at all major ports in Ocho Rios, Falmouth and Montego Bay.
He further advised that total visitor expenditure rose by 8.1 per cent to US$932.2 million, relative to the corresponding quarter of 2018, while citing preliminary data indicating a four per cent increase in airport arrivals for January 2020.
Other Service Industry subsectors recording growth were Transport, Storage and Communication, up 0.9 per cent; Real Estate, Renting and Business Services, up 0.8 per cent; Wholesale & Retail Trade, Repair and Installation of Machinery, up 0.7 per cent; Producers of Government Services, up 0.3 per cent; and Other Services, up 1.9 per cent.
Agriculture, Forestry and Fishing, up three per cent, and Manufacturing, up 0.4 per cent, were the only subsectors, of the four under the Goods Producing Industry, recording growth.
The agriculture subsector’s performance largely reflected the positive out-turn in the ‘Other Agricultural Crops’ component, up 5.2 per cent, due mainly to favourable weather conditions, which facilitated greater yields for seven of the nine crop groups.
The most significant increases were fruits, up 44.1 per cent; other tubers, up 21.9 per cent; and yams, up 7.3 per cent.
“This performance was supported by an increase of 4.2 per cent in domestic crops reaped. Vegetables accounted for the largest share of 36.2 per cent and recorded a 2.9 per cent increase in output; total hectares under vegetable production increased by 0.3 per cent,” Dr. Henry said.
Additionally, he noted that growth was recorded for post-harvest activities, up 30.7 per cent, reflecting an increase in coffee pulping and drying as a result of an increase in coffee production.
The Director General said, however, that Mining and Quarrying declined by 38.7 per cent, and construction by two per cent.
He noted that the out-turn for mining and quarrying reflected a contraction in the production of alumina, down 44.9 per cent, due to a cessation in activity at the JISCO/Alpart refinery in Nain, St. Elizabeth, and lower outputs from the other two refineries that were operational, while adding that the out-turn for crude bauxite remained relatively flat, at 0.1 per cent.
Dr. Henry said the decline in construction resulted from a contraction in the ‘Other Construction’ component due to reduced civil engineering works capital expenditure, despite growth in building construction.
Among the entities recording lower capital expenditure were the National Works Agency (NWA), which disbursed $3.2 billion, down 54.2 per cent; Jamaica Public Service Company (JPS), which disbursed $4.2 billion, some 30.7 per cent less than the sum for the corresponding period in 2018; and the Port Authority of Jamaica (PAJ), which disbursed $2.2 billion, down 41.1 per cent.
Dr. Henry said growth in building construction was consequent on increased residential and non-residential component activities.
He indicated that residential construction activities were driven by: a 133.4 per cent increase in total housing starts by the National Housing Trust (NHT), a 19.4 per cent increase in the value of NHT mortgages, as well as work in progress on previously started developments in both components.
“With respect to the non-residential category, the main drivers of growth included the construction and renovation of commercial buildings,” the Director General added.
Meanwhile, Dr. Henry said the estimated 0.9 per cent 2019 calendar year out-turn was spurred by 1.6 per cent growth in the services industry, despite a 0.9 per cent contraction in the goods producing industry.
The subsectors recording the strongest growth were hotels and restaurants, up 4.9 per cent; finance and insurance services, up 3.4 per cent; other services, up 1.9 per cent; and manufacturing, up 1.8 per cent.
Dr. Henry noted that Jamaica’s short-term economic prospects are positive, with growth for January to March 2020 and, by extension, the 2019/20 fiscal year, projected to range between zero per cent and one per cent.